Market forecasts – how I would get them wrong

Assumptions, Learning, Marketing, Product Management

In product management, one of the key things that is expected is building a market forecast and then getting a budget approved.

Being in a services space, our services were centered around some software products. Which meant that if the software products didn’t sell our forecast would be worthless. So the OEM being able to sell the product was critical. As an example if SAP becomes a leader in the ERP space then all the service providers who have capabilities around SAP have a large market to target and their business will grow.

Generally I used to map all the people, at the OEM, who were involved with the specific product. These people would also help lead us into customer requirements.

Now the challenge is that most people who are part of the same team will generally always give the same pieces of data. Therefore there was a bias in the data that was being fed to me. Now since I was also invested heavily into the relationship with the OEM, I was also not willing to see if there were somethings about the data which were not ok.

Just to put things in perspective, this same method had also made me immensely successful as a product manager. The key was that at that time the products were successfully getting sold by the OEM, so that momentum also helped us sell a lot of the services.

As they say , failures give you lessons , to succeed to the next step. I realized I needed to meet people who were not involved with that product within the OEM and outside to see how they were performing. I also started asking questions of why its not a good idea to go with that product.

This helped make my investments into building service capabilities around specific products more rational. It also helped me push the technical team to create more cross functional capabilities.

As a product manager or marketing manager you have to learn to find a way to not fall into the dual traps of group think and confirmation bias.

Till next time then.

Carpe Diem!!!

Segmentation of a niche by usage

Marketing, Product Management, segmentation, single target market

I keep writing about identifying a Single Target Market. It all starts by segmenting the market and then breaking it down further till you can reach a level of control on the market which you can Dominate.

Once you start dominating one market, you can move to the next, and next till you dominate the whole segment.

As an example you are the Product Manager for a telephone company which wants to segment the market by coming out with phones targeted at ladies. You can segment this further by either age , rural and urban, by the language options or all of them.

After you have done this level of segmentation you are left with a certain demographic profile combinations. Lets say one of the combinations you decide to choose is a lady, urban, upto 40 years of age, speaks English.

What you do next with the usage could look at this combination and see how many of these are homemakers and how many are working ladies. Now comes the interesting part. In this age group a lot of these ladies could be moms with small kids.

These days kids are smarter than us. So they could end up using their mother’s phone even when it’s locked because they have noticed the password that the mother uses. They then accidentally delete an official email or send an unwanted message accidentally to someone which is embarrassing to the mother later.

As a product manager can you incorporate a feature in the phone where working moms can physically block their phones (like child locks in cars) so that she’s at peace that her child will not be able to make calls or access official emails. You then target this specific usage to go to market. While even other ladies may like this, you’re targeting all your messaging to this segment alone and wanting to dominate it.

Till next time then….think of domination of your market.

Carpe Diem!!!

Working backward from the customer result – B2B scenarios

B2B, Marketing, messaging, Product Management, single target market

I wrote a few posts on how you start with the customer result – what will delight the customer so much that they will become “raving fans”.

Lets now look at how this could possibly work in a B2B scenario where you have a multiple people involved in making the decision.

So if you start with a result that will delight the customer – define that customer in as much detail , with who that customer WILL be and who WILL NOT BE. I keep emphasising on this point in all my product management and marketing posts. It is always more important to define whom you will not like to serve. That portion of the market is always larger than the market which you can serve.

Once you have defined the boundaries of your service or product to delight, then look at how you will reach her and get her attention. In a B2B scenario this is a very big challenge.

Many people are wanting to get attention of our person. These are primarily 3 sets of stakeholders who are vying for her attention. First is her seniors, then her peers and more than anyone her reportees.

Now within all this chaos there are hundreds of messages which are also vying for her attention from all these stakeholders as well as vendors like us. In addition there are the pressures of her personal life which could also be occupying the same attention span.

So who gets priority
Not your message for sure….until and unless it is something that catches her attention.

Till next time then

Carpe Diem!!!

Working backward from the customer result – Part 3

Assumptions, Customer Delight, Customers, Marketing, Product Management

Now from here onwards, things get interesting. We have worked on the Future Reality Tree. We have identified the possible chokes / constraints in the system. We have also exposed the unspoken assumptions in our thought pattern.

So now we realise that the same Product or Service can be used for different use cases. And based on the use case the delivery can be different, the users can be different and therefore the method to reach them to give them your message can be different. This is where the role of product management stands out.usto

Lets take a very mundane example of an everyday product – car engine oil. Every car needs it. There’s not too much differentiation. Now the engine oil can be sold to the OEMs – here its a bulk purchase. It can be sold to the authorised service centres of the car companies – it will still be bulk purchase but the quantity and therefore the negotiations will be different. And you can sell it at gas stations (so you have to talk to multiple gas stations and the quantities are smaller) And you could also sell it via maybe big box retailers.

For each of these different markets your packaging would change, the people you connect to for getting the deal change.

So you identify each segment and how you will reach them, what are the dynamics. A big OEM may not want to add another vendor to their existing suppliers even if you have better product specs, because it can hamper production/roll-out schedules.

On the other hand a gas station may only keep small quantities of small size packages. Since she already has existing suppliers giving the products why should she look at yours.

This is where your true marketing creativity comes out, when you start working backwards from the end result.

Till next time then.

Carpe Diem!!!